cryptocurrency in divorce in Spartanburg SC

The Growing Issue of Cryptocurrency During a Divorce

There’s no shortage of difficult conversations during a divorce. One that often causes plenty of disputes is the division of assets. With cryptocurrency and NFTs rising in popularity, this discussion just got more difficult for thousands of couples across the United States. If your or your soon-to-be-ex-spouse have cryptocurrency, find out what will happen to it and how it may affect your divorce.

When you’re ready to sit down and talk about your family law concerns with Nowell Law Firm, we’re here for you. Call us at 864-707-1785 to schedule a consultation now.

What is Cryptocurrency and How is It Valued?

Cryptocurrency is a digital currency that is secured with blockchain technology. Since it’s held on a distributed ledger, rather than a centralized agency like a bank, it is supposed to be difficult to trace, counterfeit, or double-spend. This is difficult for non-crypto fans or investors to understand, but you can think of it as a type of currency you can theoretically spend like money.

While cryptocurrency is supposed to be an option outside normal currency options, it is still largely valued in the user’s country’s currency. During your divorce, each coin of cryptocurrency your spouse has will be given a specific value in American dollars.

The Difficulty of Dividing Cryptocurrency

If cryptocurrency is like money, it doesn’t seem like it should be so difficult to divvy up—right? Unfortunately, that isn’t the case. To start, cryptocurrency is far more volatile than the American dollar.

In June 2022, for example, the crypto market crashed. This started in May, when a coin called TerraUSD collapsed in a matter of days, resulting in the loss of billions of dollars. Many other coins followed suit, and even those that are considered more stable have lost a mind-boggling amount of money for investors. Some coins stopped allowing customers to redeem their coins, leaving them stuck with useless currency.

You can see, then, how this might affect your divorce. Imagine you’re divorcing and your ex-partner has $15,000 worth of Bitcoin. Between the settlement and the finalization of your divorce, the market crashes, and the Bitcoin is suddenly worth $7,500. Your spouse traded $7,500 of assets to you in order to keep their Bitcoin. How will this affect your divorce, and will it delay it further?

This can also go the opposite way. If cryptocurrency gains substantial value before the finalization of your divorce, you may feel cheated out of assets. That’s why it’s so important to talk to a divorce attorney, rather than trying to handle these issues on your own.

Are You Worried About Hidden Cryptocurrency?

As long as cryptocurrency was acquired during the marriage, it is considered a shared asset. This means that it must be divided when the marriage ends. Your spouse cannot lay sole claim to it by claiming that they bought it with their own money or did not involve you in their decisions.

The good news is that it’s unlikely you’ll divorce without knowing your spouse has cryptocurrency. Crypto investors are notoriously outspoken about it, often to their own detriment in situations like this. If you suspect that your spouse is hiding cryptocurrency or other assets, you can talk to your attorney about it. Although it is decentralized, it is not nearly as anonymous as users believe it to be. A forensic accountant can track your ex-partner’s deposits, withdrawals, and other coin transactions.

If your spouse does try to hide assets during a divorce, trust that a forensic accountant will be able to uncover them. If that happens, it is unlikely to go well for your spouse in court. Family court judges do not like when divorcing couples try to harm each other as their marriage ends, and they are likely to use your spouse’s poor choices when making decisions related to your divorce.

Choose Nowell Law Firm for Your Divorce Case

As soon as you know divorce is on the table, it’s time to take it to a family law attorney in Spartanburg. Our team is here to explain your options, learn more about what you want from a divorce, and create a plan that meets your needs. To schedule a meeting, call us at 864-707-1785 or contact us online.

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